Food Aid Procurement and Transportation Decision-making in Governmental Agencies:

Abstract

Abstract This article conceptually and empirically examines sourcing of food aid, comparing the approaches promoted by the United States with those of the United Nations (UN) and the European Union (EU). In the recipient country approach (RCA) promoted by the United Nations and the European Union, transaction cost economics (TCE) suggests that RCA provides faster aid with fewer transaction costs. In the donor country approach (DCA) practiced by the United States, the resource-based view (RBV) suggests that the superior resources of a donor country assure a higher quality, safer, and plentiful food supply. Using a comparative case analysis with data provided by the United States Agency for International Development (USAID), we provide evidence that RCA and DCA as practiced in reality are both suboptimal. Improved sourcing and transportation options computed through quantitative methods can offer significant benefits over both approaches. We propose a contingency approach that reduces landed costs of food aid by giving governmental relief organizations more flexibility in RCA versus DCA sourcing, which can be justified by resource dependency theory (RDT). Our findings contribute to the decision-making and policy discussion about the efficiency of governmental food-aid programs.

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